canon rumors FORUM

Yes, you rotate it until you get the effect you desire. The angle of the sun matters, and best resutls are at 90° to the sun. If you're moving the camera around for the shot, and you change the angle relative to the sunlight, you'll change the polarization, too - probably with undesirable results (exposure changes, etc.).

Be careful of using polarizers for video. Polarization works on the angles and if the camera is moving then it can cause issues with different amounts of polarization occuring. Also it causes change in the colors of things and if you are doing a shoot with multiple clips, then color matching and look matching between clips becomes a huge issue. I will suggest that you first try out with polarizer.

As for how it works what others have given is the best answer unless you are not using circular polarizer.